'First drone war' with Pakistan offers edge for makers to compete with China, Turkey
asia.nikkei.com
The Indian military drone manufacturing industry is expected to enter a phase of rapid growth in coming years, as the order books of local makers swell following the South Asian nation's conflict with Pakistan last year, which has boosted their profiles as low-cost makers.
Flying Wedge Defence and Aerospace, an Indian startup founded in 2022 and yet to raise its Series A venture funding, secured a $30 million export order for its drone products in August last year. "We're now aiming to hit an export order book of $100 million over the next year-and-a-half," founder Suhas Tejaskanda told Nikkei Asia.
Such growth is not just limited to early-stage startups.
Smit Shah, president of the Drone Federation India, told Nikkei Asia that in the fiscal year through March 2026, about two-thirds of the revenue of up to 30 billion rupees ($317 million) from Indian drone sales came from military contracts. Revenues from military contracts are now "expected to grow four to fivefold by March 2028," Shah said, adding that drone exports, which make up under 10% of total revenue, would grow at a similar clip.
Drones have had a very limited presence in India's defense industry up to now. The country's total arms exports, for example, jumped 62% year on year to 384.24 billion rupees in the same fiscal year, but those of military drones likely made up less than 5% of the total, industry executives estimated.
However, the widespread usage of drones in the conflict between India and Pakistan in May last year -- dubbed the first "drone war" between the nuclear-armed neighbors -- put the spotlight on local companies like Solar Industries, NewSpace Research and Technologies and Zen Technologies, which saw their products deployed during the conflict.
Now, the country's drone companies are building on that reputation for battle-readiness to increase exports. They have to some extent already capitalized on the seismic shift in the perception of low-cost drones, driven by the success of such weapons in the Ukraine war and now the Middle East conflict pitting the U.S. and Israel against Iran.
Solar Industries, which makes a wide variety of weapon systems, including a multi-barrel rocket launcher, announced export orders worth over 28 billion rupees in stock exchange filings between November of last year and January of this year, all of which are expected to be delivered to customers over the next four years. Ideaforge, meanwhile, won a contract last month to sell surveillance drones to U.S. law enforcement agencies.
Drone-related businesses are also showing signs of growth.
Zen Technologies, which makes simulators for various military products such as submarines,
expects to earn over 10 billion rupees in exports over the two years through March 2028, about half of which is expected to come from anti-drone systems, Chairman and Managing Director Ashok Alturi told Nikkei Asia. In the fiscal year through March 2025, these systems, which combine radar, optical detectors, jammers and cannons to intercept drones, accounted for over half of the company's total exports, worth 3 billion rupees.
Details on most of these deals are obscure. Solar Industries does not provide the share of drone-related products in its export orders.
Flying Wedge's client for its export deal is only identified as a "Southeast Asian country."
But Flying Wedge's Tejaskanda said that the company is supplying its flagship long-range attack and surveillance drones, as well as interceptor drones, as part of the $30 million-export deal. The startup is also in talks with clients in Kenya and Portugal for future exports, he added.
Indian military drone makers are mostly competing with Chinese and Turkish manufacturers for supply contracts with the armed forces of countries in Southeast Asia and Africa, industry executives said.
"There are five major players in this ecosystem: Israel, U.S., Turkey, China and Iran," Tejaskanda said. "The first two are usually very expensive, and Iran faces challenges from the U.S. sanctions."
Price competitiveness is also a factor supporting export growth expectations.
For instance, Flying Wedge's Kaal Bhairav, a medium-altitude long-endurance (MALE) drone, costs between 10 million and 40 million rupees ($105,500 and $422,000), while a rival product by an American company costs $30 million a piece.
Indian drones, or unmanned aerial vehicles (UAVs), can also fill gaps left by other makers, said Shah from Drone Federation India.
"Very large UAVs will, for some time, be dominated by the West, and very small UAVs will continue to be dominated by China," Shah said. "But we have a very solid role to play when it comes to the tactical, medium-sized class of UAVs."
Moreover, the effective usage of drones like Iran's Shahed platform has decreased the importance of often expensive certifications, like NATO's standardization agreement, or STANAG, as clients are happy to forgo them in order to buy cheaper, battle-tested products, Tejaskanda said.
P.S. Apparently, Flying Wedge's export customer is Thailand.